Call to eliminate taxes on electric cars in South Africa

With the 2026 Budget Speech set to go ahead tomorrow night, calls are mounting on Finance Minister Enoch Godongwana to align import duties on electric vehicles (EVs) with those of internal combustion engine (ICE) vehicles.

Zero Carbon Charge (Charge), a company committed to building a renewable energy EV charging network across South Africa, has also called on the minister to scrap the ad valorem tax on EVs.

Charge also suggested that the minister allocate dedicated funding for the rollout of off-grid, solar-powered EV charging infrastructure nationwide.

“You cannot incentivise EV production on one hand and penalise EV adoption on the other,” said Joubert Roux, Charge Co-Founder and Chair.

“Without urgent tax reform and infrastructure funding, South Africa risks constraining domestic EV demand at precisely the moment it is trying to attract EV investment.”

Charge believes that South Africa cannot claim to prioritise decarbonisation and industrial growth if it continues to tax clean mobility, and should not expect EV adoption to accelerate without funding infrastructure.

The company said it welcomed the 150% manufacturing tax incentive for electric and hydrogen-powered vehicles from 1 March 2026.

It did, however, warn that it will not increase the adoption of these vehicles if they continue to be subjected to high import duties and ad valorem taxes.

Roux, quoting Naamsa data on new energy vehicle (NEV) sales, shared that demand for these vehicles is growing.

Hybrid and electric passenger vehicle sales rose 8.1% year-on-year in the first ten months of 2025, reaching 13,358 units, and leading to a market share of at least 3.8%.

“It will stall if drivers don’t see charging stations where they need them,” declared Roux.

“Without a visible, reliable network, especially along major highways and freight corridors, consumers will lack the confidence to buy EVs.”

Charge is calling on the National Treasury to move beyond its policy intent and fund charging infrastructure, which it committed to in the 2023 EV White Paper.

According to this policy, charging infrastructure is the pillar for South Africa’s electric car transition, and commits the government to enabling a large-scale rollout by removing regulations and attracting private investment.

The White Paper also acknowledges that off-grid charging solutions can support EV adoption without adding pressure to the existing electric grid.

Time for change

Charge is calling for Treasury to fast-track the implementation of the EV White Paper and support the rollout of off-grid charging stations by recognising them as both energy and transport infrastructure.

A nationwide EV charging network is most likely to be built by the private sector, but only if South Africa’s financial framework enables it.

Charge is therefore calling for the 2026 Budget to include clear tax outlines for EV charging infrastructure, including VAT certainty on electricity sold through charging stations.

The company also seeks confirmation that charging and battery storage assets qualify for existing renewable energy tax incentives.

To reduce upfront capital costs, Charge hopes Treasury will accelerate write-offs for charging equipment and battery storage.

It seeks access to concessional, long-term finance through development finance institutions and targeted co-funding, such as capital grants or support linked to electricity dispensed, to de-risk early-stage rollout.

Finally, Charge is campaigning for dedicated renewable energy micro-grids funding, enabling off-grid, solar-powered systems that add clean generation capacity without increasing pressure on the national grid.

“Charging infrastructure requires significant upfront capital and long payback periods,” Roux said.

“Government doesn’t need to build the network, but it must create the conditions for the private sector to scale it.”

He added that if South Africa is serious about competing in a rapidly electrifying global economy, fiscal reform and infrastructure rollout must go hand in hand.

“With the right signals in this budget, we can build a world-leading, grid-independent EV charging network powered by renewable energy,” concluded Roux.

Charge is committed to partnering with the South African government to make local electric mobility viable.